Transcript

Paul Ford I’ve seen you be a purifying fire, it is a hell of a thing.

Rich Ziade Oh, thank you, Paul, you’ve said, I mean it’s just one of the nicest things I’ve heard.

PF I’m more of like a purifying sweater. [music fades in, plays alone for 14 seconds, ramps down]

PF Hey, Richard, let’s talk about enterprise software, something we do occasionally talk about on the show. First of all…

RZ Let’s define it first.

PF Okay. We build software, we build products. And increasingly we work with larger and larger companies. And we build things that hundreds of thousands of millions of people might access. And yet I would not call us an enterprise software company, even though we work with very large organizations that often purchase a lot of enterprise software. So how would you explain the difference?

RZ Enterprise software software you have to use or you’ll get in trouble at your job.

PF Or with the government. Like I don’t think people realize that these systems like SAP like the really big ones, because they have encoded accounting systems, especially for like global supply chains. [yeah] It’s almost impossible to go outside. Like really, do you want to figure out Brazilian tax code enforcement in your, like shipments of hex nuts? No! Really big companies need knowledge encoded in their systems.

RZ And look, you are a captive user. It’s not like you’re gonna go shopping around for a different app that’s gonna do the thing, you’re gonna do the thing, you’re going to use the thing and you’re gonna get good at it, as rough as it is, as unusable as it is versus the the consumer software space where in the consumer space where A, it’s competitive. So if you fail in your design, the user can go elsewhere. But more importantly, [yeah] engagement drives everything with consumer apps right. So if the thing isn’t, is too hard to use, or requires you to open up a user manual, you’re gonna bail on it, and you will bail on it. So the result is enterprise software is five to ten years behind in terms of the importance of user experience, vis-a-vis consumer software.

02:19 

PF It’s funny too, because you go, you’re like, what is that? What are they all talking about? Especially because we’re in some rooms where people are talking about their enterprise, whatever solution. [mhmm] Let’s do a typical like consumer or classic b2b online sales process. The project is called Receiver. I don’t know what it does, but I know that I need to get it I google receiver receiver accounting or whatever. And a page comes up and it tells me what it is tells me how much it costs. And then it usually shows me some screenshots and I can have access to a demo, and I can play with it, maybe even a video and I can sign up for the newsletter and read blog posts, and it’s pretty great. I don’t have any doubts about what Receiver is going to do for me as a software as a service account. Project let me go for an enterprise solution receiver enterprise or like super-ceiver, which is, you know, I don’t know, it’s a product of SAP. Nothing, a picture of three people from different parts of the world shaking hands.

RZ Give me your phone number. [Paul chuckles]

PF Yeah, maybe I can download a white paper about account global accounts supply chain advisory systems. Yeah, yeah. And then a call to get in touch. And really an assumption that I already know exactly what this is and why I need it. They’re not gonna tell me what this is.

RZ No, they’re not they want to talk to you. First of all there, they also want to see who you are as a decision maker because the purchase process and you you you went right for the sales process, right? Or that user acquisition process?

PF Well I think because it’s so this world is so confusing to sort of software civilians, right? You hear about these things, and you’re like, Oh, well, let me go learn about them. And even their Wikipedia pages are impenetrable. You can’t figure out what the hell they do.

03:57 

RZ You can’t but you’re touching on a trend that we’ve talked about in the past on this podcast, which is these days, it’s becoming and Slack kind of lead the way here, it’s becoming really important to let people play and touch the thing because they become evangelists for your product within your company or within your organization, right?

PF Product lead growth.

RZ Product lead growth, right. But the truth is, you know, we go into a lot of organizations, and it’s just the shittiest software you’ve ever seen, like, these are companies that have been refining this piece of software forever, and keep refining it. And by refining, I mean caked on more features without really thinking too much about design.

PF Talk to process a little bit. So what happens is you have seven factories and you needed to manage how those factories sort of like communicated and you know, ship things to each other and who worked there…

RZ Raw material acquisition.

PF You hired Deloitte, you hired a giant consulting firm 10, 15 years ago, and this is not to burn any particular firm but you heard one of the big ones, and they did exactly what they said they would do. Maybe it ran over, maybe not. And they delivered you the best possible system for that error. And it’s now 15 years later, the operating system is old. The Java version is old database version is old. And the cost of updating and changing it is almost greater than any other cost that you have in your org.

RZ On top of that, since they launched it, they have been incrementally adding features to it, which is akin to, you ever seen those cars that just get like they only bring them out during parades? Because they’re so bizarre. And there’s just all kinds of there, they’re ornamental…

PF Yeah, where they like glue shells all over the cars?

RZ Yeah. Like when we peer into a product that’s been around for 10 years. We can see its history in the UX, right?

PF You can see that on cloud utilities too, but it’s profound. When you get into this world. You didn’t see that with all software, but boy, can you see it here, and then they’ll tell you, every shell every shell is sacred on that card.

05:53 

RZ Also, sometimes they’ll say I had nothing to do with those shells. Those 10 on the back of the car. That was before my time. They’re still here, not sure why it does what it does I have ideas as to why it does what it does. But it’s there and we do have, there’s a population of users in Arizona that swear by this feature. And I can’t tell you why. And I’m not sure when they would it was given to them, but it’s there right you know, and I wrote an article A while back Backlog Driven Development.

PF That’s right. Okay. What was your big point?

RZ My big point was, you’ve got two funnels that come into product. One is through sales and sales losses. They keep telling me they want this feature. I’m not gonna, they don’t want to go with us they’re gonna go with Acme Inc. Because we don’t have this feature right and it keeps coming back. Sometimes software reacts immediately it gets ticketed, it goes right from like bad sales outcome lost the deal to JIRA ticket. Okay, that’s one source. Right. The other is customer, which is the more prevalent one. We have American Express as a customer They’re about to renew the license. They asked for these six things. And they are bizarre. And they’re weird. And they’re incredibly specific, incredibly prescriptive. It’s a big contract. So we’re going to put those in there as well. So what you end up with is this JIRA. That’s like a product of an LSD trip, right? It’s just this, no one’s bothered to distill down how a product should evolve.

PF Even more than normal.

RZ Even more than normal. Exactly. So what you end up with, essentially, is our engineering teams and designers sometimes chewing through backlog, and you see it, right, our HR platform, which I’m not going to run through the mud, you could see…

PF The features, you see features.

07:43 

RZ So you end up with enormous debt. And people when they say technical debt, they often times they mean, well, it’s getting really expensive to maintain. But I think there’s another dimension to technical debt, which is a product that is unwieldy to users, that add steps that add complexities, that requires more training, that’s debt as well, right. And the reason that exists is because you don’t have that product intermediary who is taking all of those inputs that shouldn’t be taken literally and translating them into a real product strategy. That is the fatal error in enterprise design.

PF That is enterprise, right. So you know, it’s fascinating to me. So then there is this kind of a world that we live in, which is what can five to ten people do for me over six months to a year, that is Postlight, right. Like, what, what can we get done? We got to reboot this, you’re not gonna hire us to build on top of your Oracle platform, like and you’re just probably not. Like you could, but you know, why? There is a zone in the middle. Okay, so there’s us, and then there’s enterprise and then in the middle, it’s almost like accidental enterprise like Slack where they just built a good chat tool, but it actually because it was about work. It just kind of kept going and going and going and then what happens is everybody freaks out like Microsoft is like, well, we need our own Slack, we’re gonna have to drop it in there and that you know, or…

RZ Microsoft Teams.

PF Ah, Teams, right? We got to get in there. Let’s see, what kills Microsoft every time is that they’re gonna integrate it with Office a little more closely than anybody else could.

RZ Of course, of course.

PF It’s just this tar pit. It’s like the woolly mammoth just sinking into the tar. [Rich laughs] Because they’re just, oh, well, you know, everybody Excel and they’re not wrong, right in that hundreds of millions of people end up using teams and whatever the name of the file storage network thing that is that they 365 or whatever. And then there’s god. I’m blanking on everything. But Slack just kind of backed into being an enterprise company. It’s not set up to be an enterprise software company. They don’t have teams of salespeople to fly out where everyone is named Mike. [Paul laughs]

09:51 

RZ Now, it actually caught a lot of the typical buyers of software of enterprise software flat footed because they would look over at first it was like Okay, wait, we got a block this. It’s a 2000 person company, 130 people in HR, all in HR is using some tool to chat. It’s crazy. Like they’re literally putting employment contracts in there. This is no, this is unacceptable. We’ve got to stop it. It’s not about the number of people because this isn’t about democracy. It’s about who becomes an advocate for it. When a VP becomes an advocate for a tool that came in and it’s like, wow, this is really easy to use. I didn’t need to call Stan in it to get it going. Right.

PF That’s your accidental enterprise, right there is when executive leaders are using the tool, because it allows them to be more effective and have more control over their their work. IT will pry it out of their damn hands, there is not a chance that that VP is going to give up slack. If the VP thinks that Slack is helping them manage their team more effectively and have more control over their work.

RZ Make it work.

PF Well IT comes in and it’s like, Hey, you know, we didn’t really go through the process was Slack. I see a lot of risk there. And the VP thinks I want to go to the Four Seasons. [Rich laughs]

PF What are you doing?!

RZ Now, look, there are some places where like for regulatory, like banking, like Slacks got a steeper hill when it comes to like, right, like highly regulated sectors and whatnot. But I I’m not gonna name the publisher, but there was a publisher, they literally woke up one day and 12,000 people were using Slack. [yep] And and it was over like that. It was just okay. I guess we’ll have to live with this. And you know, for a very long time, Slack was free. slack was investing, essentially, and letting people become addicted to the platform.

PF Well, no, I think the point I make there too, is API access always really easy was like always, right. And so instead of trying to take on and I don’t think this was even anybody’s idea is like, all right, we have this giant enterprise system, it’s SAP it does. We do HR through it, and we do our ERP planning, and we do it has a publishing module, and so on and so forth. What’s happened and this is always the deal with the web is that you’d have these API’s and kind of glue together just enough software. Were in order to have your stuff solved, right? The hard part with that the fantasy is that a sort of Central coordinating framework would emerge magically, as you glue stuff together? It turns out that’s not the case, right? You can end up with a lot of pieces loosely joined. And then you just end up with a lot of pieces loosely joined. [yes] But if you do the product work, and you get stuff in the middle, instead of spending 10s of millions of dollars, you can spend 10s of million dollars in ongoing licensing fees [yeah] on a per user basis without clear knowledge, which is what the kind of that middle tier does, really, they’ll get you.

12:33 

RZ And look, we talk about product management a lot on this podcast as if it is like the way the world works. There are still many, many, many organizations where the idea and the mindset of product leading the way is not in place like we’ve seen it, in fact, that posts like we bring it to places where it’s just called it’s not a fault of anyone. It’s just culturally hasn’t been installed. It just was never really out of the thinking. And so we bring that.

PF Bring this home, Rich, bring this enterprise software podcast home.

RZ So here’s the here’s the rub, Paul. Sometimes you know what the right thing is, and you’ve got the leadership and the leadership wants to make the change. But here’s what ends up happening. platforms like this enterprise software, it’s been around for 10, 12 years, breeds expertise, that becomes very rigid, very stubborn, and very defensive about what it is and their expertise and their understanding of this one in a billion species that they have nurtured over the years. Like it’s it’s there, it’s it’s theirs. It is not there by mistake.

PF It really breeds expertise that wants to go home at 5:30 and doesn’t want to answer [ohh!] to some new platform, right? No, I’m serious. Like, it’s just when you’re in that environment. When you go talk to those people…

RZ It’s very hard, very hard to dislodge it.

PF Their job is very, very structured. And so you’re coming in with a lot of change, and they’re like, this is actually a form of madness. You’re not seeing clearly because you’re about to take something that’s utterly organized, structured and predictable, and introduce unbelievable amounts of risk, which also happened to utterly screw up my ability to run my own life and have my own schedule.

14:12 

RZ This has been labeled transformation in a lot of ways because evolution, you know, there’s before the dinosaurs and after the dinosaurs, like, you know, we didn’t evolve out of it. It’s not evolutionary, because people dig in. And the inertia of the existing platform is too strong. So this whole notion of digital transformation, meaning Do you have the guts to uplift the whole thing? Right. That’s the challenge that’s put in front of thought leaders and business leaders is like, do you Are you ready to really modernize? Right. Like banks for a long time? Yeah, they had to be led the way right. Like there was one bank. I think it was like, I think it was either Capital One or Bank of America. One of those were like, you know, we’re gonna let you deposit checks on your phone. Done deal. We’re going to do it. You needed one player to do that. And then everyone I was like, Well, you can’t, you can’t. But then they saw the competition do it and it was over right? That mobilizes you quicker than anything. I don’t give a shit. If you don’t understand how you’re gonna deposit checks on a phone, you’re gonna deposit checks on the phone, they’re taking money, we’re gonna take the money.

PF Well, the great thing people say to nobody really wants that, right. It’s all fine until that one boss like sees their nephew do it. And…

RZ Competition. Yeah, exactly. Exactly. It’s like, why aren’t we doing it? So. We live inside of the middle, like, we’re in the middle of all of this, Paul.

PF Well I think literally, literally in the middle. No one’s calling us to do their enterprise blah, blah, blah, for eight bazillion dollars over the next 6000 years. Right?

RZ Nor are they calling us to build that one feature on top of the old legacy system. They’re asking us that to rethink things right to step back and rethink things. And that’s you’re seeing that more and more today, right? Like you’re seeing people understand that to really take it to the next level. You have to step back. You can’t, it can’t be evolutionary.

16:01 

PF There really is a sense to I get this just from being part of conversation with people who might engage with us of just you seem like smart people, can you get a room and help us with this, right? Because it’s gotten so rigid and so complicated, it needs to get unlocked, kind of from first principle, people need to figure out what they actually want to do. And then the new way of doing this is to glue together three or four systems and, you know, put something in the middle that lets you coordinate it, and that I was joking earlier. But I mean, that usually costs about a 10th as much as the big enterprise system after you get it all. So.

RZ [music fades in] That’s the other rub, right? Like, which is that you…

PF Mhm. They’re so good. 

RZ That if you do it right, that you shouldn’t be, you know, shoveling globs of money to get this done. It does not…

PF Extremely, extremely efficient, effective sales organizations kind of tend to destroy their own companies, because there’s just that point where it costs one eighth as much and they’re like man, and nobody wants that. Don’t worry about it and then kind of purifying fire run through the company about two years later.

RZ So speaking speaking of purifying fires, I mean Postlight is a digital strategy design and engineering firm. [Paul & Rich chuckle]

PF That is right.

RZ Lots of great clients you check us out of Postlight.com reach out at hello@postlight.com

PF Check out MailChimp.com/developers, the recent work we did that we’re very proud of [yeah] helping MailChimp drive their developer outreach forward and get their ducks into sort of, sort of beautiful app stylesheet. So, but yeah, if you need us, you know where to find us. We love you. Everybody stay safe out there, or in there.

RZ Have a great week in or out.

PF That’s right.

RZ Take care.

PF Alright, let’s get back to work. [music ramps up, plays alone for 3 seconds, ends.]